The 10 Best Car Insurance Companies in Michigan in 2020
In general, the auto insurance Michigan residents are offered is the most expensive in the US. In fact, the state’s insurance system is so expensive that the majority of companies there operate on a loss. The state’s limitless no-fault system and the rising costs of medical expenses are the sole causes.
We’re here to help you navigate the hardships faced by drivers in the Great Lakes State. In our guide, you’ll discover which Michigan companies offer the cheapest car insurance, and we’ll provide tips on how to get the lowest premium possible. Furthermore, you’ll find definitive rankings of all the prominent Michigan insurance companies in departments such as customer service and financial stability.
The Best Auto Insurance in Michigan
- Overall Winner: Auto-Owners Insurance
- Runner Up: State Farm Insurance
- Best for Discounts: MetLife Insurance
- Best for the Military: USAA Insurance
- Top Choice for Roadside Assistance: AAA Insurance
- Best for High-Risk Drivers: Progressive Insurance
- Best for Online Tools: Geico Insurance
The Overall Winner: Auto-Owners Insurance
Auto-Owners should be your starting point if you’re looking for the finest auto insurance Michigan can provide. To begin with, the company has an “A++” A. M. Best rating, which is the best score possible. This indicates outstanding financial stability. Also, it boasts of an excellent NAIC (0.53) ratio, which reveals it takes good care of its customers. However, its performance in 2019’s J.D. Power regional study is about average only, with three out of five stars.
The best part about Auto-Owners is its excellent rates. While the company doesn’t offer the cheapest car insurance in Michigan, it still belongs among the affordable options on the market. No matter which category of driver you belong to, getting a quote from Auto-Owners is a no-brainer in Michigan.
Choose Auto-Owners for its excellent scores all over the board.
Look elsewhere if you want the most affordable premiums.
The Runner Up: State Farm
State Farm is an insurer that scores above average in almost every category in Michigan. For starters, the company is the most prominent insurer in the state of Michigan and in the entire US. Being such a large enterprise guarantees excellent financial stability, a polished website, and a smooth quote process. However, it’s among the more expensive insurers. Whether you’re looking for cheap PLPD auto insurance in Michigan or full coverage, be prepared to pay more if you choose State Farm.
Nevertheless, State Farm scores a fairly impressive 4 out of 5 stars in J.D. Power’s regional customer satisfaction rankings. On top of that, the company offers a decent variety of discounts and optional coverages.
Choose State Farm for excellent financial strength and reliable customer service.
Look elsewhere if you want budget prices.
The Best for Discounts: MetLife Insurance
MetLife auto insurance is not the best in Michigan, but it can still be a terrific choice for some drivers. Namely, the company offers a discount to customers who belong to an employer or group associated with MetLife, which can reduce your premium by an incredible 50%. In addition, MetLife’s prices in Michigan are already quite affordable. Finally, the company’s financial strength is solid “A+” or “Excellent,” which is the second-best rating that A. M. Best awards.
The biggest drawback of MetLife auto insurance in Michigan is its low customer service score for the region. The company has only 2 out of 5 stars in J.D. Power’s regional study. Nevertheless, if you’re ready to be patient with its customer service, MetLife can be a splendid choice.
Choose MetLife for its terrific discounts, reasonable prices, and excellent financial strength.
Look elsewhere if you want first-rate customer service.
The Best for the Military: USAA Insurance
Simply put, USAA is the best auto insurance in Michigan. However, we couldn’t award the company first place because it’s only available to the US military and their close family members. Still, if you’re fortunate enough to get their coverage, you’re in for a treat. The company offers everything you could ask for, from their top-of-the-line customer service and reasonable prices to the excellent website and first-rate financial strength. On top of that, USAA also provides car loans, banking services, and financial advice. If you qualify, you can’t go wrong with USAA.
Choose USAA for its superior overall performance.
Look elsewhere if you are not a member of the US army or close family.
The Best for High-Risk Drivers: Progressive
Progressive auto insurance is famous for its willingness to take on riskier drivers. The company offers some of the best car insurance in Michigan too. Customers who have trouble finding insurance elsewhere can count on Progressive to provide reasonably priced coverage.
Additionally, the company has stable financial footing, which its A. M. Best rating of “A+” confirms. Finally, we must praise its smooth and neatly organized website.
Progressive’s customer service record, however, is nothing to brag about. It could manage only 3 out of 5 stars in J.D. Power’s regional study. However, all insurers present an inevitable compromise, and the overall impression of Progressive car insurance is quite positive.
Choose Progressive for affordable rates, even for high-risk drivers.
Look elsewhere if you want top-shelf customer service.
The Best for Roadside Assistance: AAA Insurance
AAA is not among the 10 biggest auto insurance companies in Michigan, but it’s still a viable choice in this state. The company is actually an automotive club that sells car insurance to its members. The Classic membership package costs only $56 year, which is a small price to pay for all you’re getting. The benefits include free emergency roadside assistance, travel vouchers, and discounts at over 100,000 shops, restaurants, and hotels in the US.
AAA auto insurance in Michigan is reasonably priced as well. According to our research, the company offers rates that are below the state average. In terms of customer service, AAA is not ranked in the Michigan region. Nonetheless, the company is known to take good care of its customers.
Choose AAA for affordable rates and the many perks their club membership offers.
Look elsewhere if you want the lowest prices or the best customer service.
The Best for Online Tools: Geico Insurance
Geico is one of the biggest and most well-known insurers in the US, but it doesn’t have a prominent presence in the Michigan car insurance market. That’s a surprise, given that the company has many things to offer. Its prices are below average, while its financial strength is second to none. Geico holds the best possible “A++” rating from A. M. Best. Additionally, it’s a subsidiary of Warren Buffett’s Berkshire Hathaway, the third company on 2018’s Fortune 500 list.
When it comes to online tools, its website and mobile app are a real pleasure to use. They provide all the information you may need, and they enable you to handle your entire policy online. That’s why, for tech-savvy customers, Geico should be the number one choice among the auto insurance Michigan offers.
However, it should be noted that the company’s score in customer service is average. Geico holds 3 out of 5 starts in claims handling satisfaction in J.D. Power’s regional and national studies.
Choose Geico for its excellent online tools, affordable prices, and supreme financial strength.
Look elsewhere if you want high-quality customer service.
Cheap Car Insurance in Michigan – City Guide
Car insurance costs vary substantially depending on where you call home. To verify how much premiums cost in each city, we gathered quotes with full coverage limits from all the major Michigan insurance companies. We were often unable to get an online quote, meaning we had to rely on other sources to confirm the rates. Here is the list of car insurance rates by city in Michigan:
Detroit is the most populous and largest city in the U.S. state of Michigan. However, the city lost around 60% of its population from the 1950s, mainly because of the loss of jobs in the auto industry. Nonetheless, the “Big Three” of the US car industry, General Motors, Chrysler, and Ford, still all have headquarters in Detroit. Motown is also famous for its music scene, primarily due to Motown Records, a record house that played the major role in popularizing African American music. Artist such as Jackson 5, Marvin Gaye, and The Temptation all represented the label.
Those looking for cheap auto insurance in Michigan will have a hard time in Detroit. The city is among the most expensive for car insurance in the US. Based on our quote comparison, AAA is among the most affordable insurers in Motown. We were unable to finalize our Progressive, Auto-Owners, and Geico quote, but, according to our experience from other states, these insurers should offer cheap policies in Detroit too.
Grand Rapids is the second most populous and the largest city in Michigan. It’s home to the world’s five largest office furniture makers, hence the nickname “Furniture City.” Recently, Grand Rapids became a hub of the craft beer industry. It’s Founders Brewery was ranked by RateBeer.com as the third finest brewery in the world. That’s why it got a new moniker: “Beer City.”
As far as car insurance prices go, Grand Rapids is significantly less expensive than Detroit. This doesn’t come as a surprise since Grand Rapids is a low-income area compared to Motown. That’s why its auto insurance prices are lower than other Michigan cities. MetLife and AAA insurance were the most affordable options in our quote comparison. If you’re looking for cheap insurance rates, you should add Geico, Progressive, and Auto-Owners to your shortlist as well.
Warren is the biggest suburb of the Detroit metropolitan area and the third largest city in Michigan. It’s home to the Detroit Arsenal, which was the first facility to mass produce tanks in the US.
In terms of car insurance prices, Warren is more expensive than Grand Rapids. The main reason is that it’s a Detroit suburb. In our quote comparison, AAA was significantly more affordable than Allstate. We tried to get a quote from five more companies, but they all needed to be completed by phone. This means that those shopping around for the cheapest car insurance in Michigan will have to spend more time in this part of the process than they would in other cities.
Sterling Heights is also a suburb of Detroit. The city regularly ranks among the safest places in Michigan. Perhaps that’s why Eminem chose Sterling Heights as his residence in the 2000s. If you’re a nature enthusiast, you may also want to visit the Sterling Heights Nature Center, where you can see live reptiles and amphibians—and even adopt one.
Sterling Heights is surely not the best city for car insurance in Michigan since it’s prices are close to downtown Detroit’s rates. In our quote comparison, AAA was the most affordable option, but it’s also worth considering Geico, Auto-Owners, and Progressive.
Lansing is the capital of Michigan and the fifth largest city in the state. It’s home to Michigan State University, which enrolls over 50,000 students annually. You can also find Potter Park Zoo there, which specializes in preserving endangered animals. The city tour wouldn’t be complete without the Impression 5 Science Center, with its exhibits on the most important scientific discoveries.
Car insurance in this Michigan city is affordable when compared to the rest of the state. We requested quotes from seven different companies, but we only managed to get prices from AAA and Allstate. Out of these two, AAA was significantly cheaper. Additionally, other sources indicate that Hastings Mutual, Progressive, and Auto-Owners offer affordable full coverage, as well as PLPD insurance, in Lansing, Michigan.
Ann Arbor is home to the University of Michigan, which employs around 30,000 workers, of which 12,000 are in the medical center. It’s the university that President Gerald Ford attended. Since 2005, Ann Arbor has also recently witnessed a strange trend in “fairy doors.” These small doors lead to an enclosure where people can leave wishes written on a piece of paper for fairies to pick.
As far as car insurance is concerned, Ann Arbor is among the more affordable places in Michigan. We again had trouble finding many insurers willing to provide an online quote. Nonetheless, we learned that AAA offers cheap auto insurance. Furthermore, we confirmed from other sources that Auto-Owners, MetLife, and Progressive offer affordable rates too.
The Average Price of Auto Insurance in Michigan
According to our research, Michigan is the most expensive state for car insurance in the US. The estimated average annual premium is nearly $2,300. Other studies only confirm this narrative. Michigan was also the most expensive state according to Forbes, Insure.com, and The Zebra, showing an annual premium of $2,239, $2,611, and $2,693 respectively.
So what drives Michigan car insurance rates to such high levels? The answer lies in a combination of two factors. The first is the unlimited mandatory personal injury protection coverage. The second, as Michigan radio notes, is the lack of regulated fee schedules for medical care. This enables medical providers to charge significantly more for PIP-related procedures than regular medical care.
This has been confirmed by a claims expenses analysis. One study found that the average injury-related claims costs in Michigan were $75,600 in 2013. For comparison, the next most expensive state was New Jersey, with an average of $13,630.
With such high claims expenses, auto insurance companies in Michigan cannot make any money. Between 2005 and 2014 the average loss on an auto insurance policy was 2.9%, with just three profitable years. Insurance companies have to rely on other types of coverages to pay the expenses of running their auto insurance business.
There’s been a healthy initiative to repeal the limitless PIP system. However, medical institutions continue to lobby for the status quo.
Discounts on Michigan Car Insurance
The limitless PIP system drives auto insurance prices in Michigan through the roof. This makes every chance to save welcome. Fortunately, the majority of the most common car insurance discounts are available in Michigan too. Here’s the list of the ones that nearly every carrier offers.
If you had your car insurance with the same company for an extended period without a claim, you’ll receive a discount on your premium. The exact period varies from three to five years, depending on the insurance company.
Good Student Discount
If you’re a teen or young driver, you can get a discount on car insurance in Michigan by maintaining a GPA of 3.0 (B) or higher. Drivers under 21 can also qualify for additional discounts by completing a certified training.
If you’re covering multiple vehicles or buying different kinds of policies from the same company, you’re bound to save.
Student Away-at-School Discount
You can expect to find this discount with the majority of the Michigan auto insurance companies on our list. To qualify, you have to have a teen or young adult on a policy who studies at a school that’s 100 miles or more from your residence and seldom drives the car.
Safety Features Discount
Common factory-installed safety mechanisms like anti-theft devices, airbags, and antilock brakes can get you a premium reduction. Even driving a car that has a proven record of being safe and reliable can get you a discount.
You can often save up to 10% by paying the entire premium before the policy’s first effective date.
Michigan Auto Insurance Laws
Michigan’s Minimum Insurance Requirements
Michigan has rather peculiar auto insurance laws. Its mandatory limits aren’t commonly seen in other states. These are the minimum limits you must carry on your insurance policy:
- Bodily Injury Liability – $20,000 per person and 40,000 per accident
- Property Damage Liability – $10,000 per accident
- Personal Injury Protection – Required, with no limit for medical expenses (This coverage also helps pay lost wages, any necessary help while recovering, and even funeral costs.)
- Property Protection – $1,000,000 limit (It covers expenses relating to damaged stationary objects, including buildings, parked vehicles, fences, and mailboxes.)
No other coverage is mandatory in Michigan. You can even drive without uninsured/underinsured motorist coverage. Nonetheless, most lenders will require comprehensive, collision, and GAP coverage.
SR22 Insurance in Michigan
Many Michigan auto insurance companies list SR22 insurance among their available coverages. It’s not actually a form of insurance. Rather, it’s a document that your insurer has to provide to the local DMV as proof that your insurance is adequate after a severe violation. You can even get an SR22 insurance policy if you don’t own a vehicle.
Infringements like driving under the influence or inflicting bodily injuries in an at-fault accident may trigger the need for an SR22 form. Once you enter the SR22 program, the government will monitor your driving record for several years, until you become fit for standard car insurance.
Driving in Michigan When You Aren’t a Full-Time Resident
The auto insurance laws in Michigan are pretty strict for out-of-state drivers. You can spend up to 30 days in a single calendar year driving as a nonresident with your home state’s auto insurance. If you’re spending more than that amount of time in the state, you’ll have to purchase Michigan’s no-fault insurance. Since Michigan has such a unique no-fault system, no other type of car insurance can be substituted for it.
Price Optimization and No-Fault Laws
Michigan car insurance rates are so high in the US due to two factors. The first is the state’s no-fault system. Namely, in addition to bodily injury liability, every driver has to carry PIP insurance without a payout limit. This means that two separate coverages pay your medical expenses: the at-fault driver’s bodily injury liability and your PIP insurance.
The no-fault system was created to reduce car insurance prices, but the opposite happened. And since there’s no maximum payout for PIP insurance in Michigan, it comes as no surprise that the prices are extraordinarily high in this state.
The second reason why auto insurance quotes in Michigan can be so expensive is because price optimization is still legal in the state. According to the definition by the Consumer Federation of America, “Price optimization is a method that uses non-risk-related information to systematically move insurance premiums away from their cost-based level.” This “non-risk-related information” can even be the number of quotes you’ve requested from other carriers. That’s why shopping around at every renewal term can keep your prices down in Michigan.
Tips for Finding Cheap Auto Insurance in Michigan
Compare Multiple Quotes
Numerous factors influence the final price of your car insurance. First, your profile determines how much risk you carry. You may get a better deal depending on the insurer’s attitude toward high-risk drivers.
Second, the annual strategy of each insurer is different. For instance, a company that recently made a lot of money (something that’s nigh impossible in the Michigan auto insurance system) may decide to offer more competitive prices to increase its market share.
Finally, the practice of price optimization is legal in Michigan, meaning insurers may use non-driving factors to determine your premium. These may include your credit score, education level, or your willingness to switch insurers. By getting quotes from multiple insurers, you’re showing a readiness to jump ship if a better deal comes along.
So if you want the cheapest Michigan auto insurance available, it’s paramount to shop around and get quotes from at least five insurers.
If you’re making a shortlist of the best car insurance companies, you’ll need to know how each insurer scores in the departments of customer service and financial strength. That’s where reading auto insurance reviews can help. On our website, you can find detailed rankings of all the major US car insurers. Combine it with this guide on car insurance in Michigan to make a list of the best companies for you.
Check the Discounts
When you’re getting quotes, it’s important to select all the discounts you can qualify for. In an online quote, that’s just a couple of clicks. If you communicate with an agent via phone, remind them to mention all the available discounts.
Sometimes it’s even smart to choose an insurer just because it offers the highest discount. For instance, MetLife provides up to a 50% premium reduction for associated employees. It’s even worth taking proactive measures, like passing a defensive driving course, to reduce your premium even further.
Frequently Asked Questions
1. Who has the cheapest auto insurance in Michigan?
According to our quote comparison, AAA offers the most affordable car insurance in the state of Michigan. Geico and Progressive are also dirt cheap insurers per our reviews, but at the time of writing this guide, we couldn’t get quotes from them in this state. Nonetheless, both companies are available in Michigan according to their websites.
2. What is the minimum auto insurance coverage in Michigan?
Michigan drivers will have to carry the following limits:
Bodily Injury Liability – $20,000 per person and 40,000 per accident
Property Damage Liability – $10,000 per accident
Personal Injury Protection – No limit for medical expenses
Property Protection – $1,000,000 limit
3. What is the average cost of auto insurance in Michigan?
It’s approximately $2,300 annually. This is the highest average car insurance price in the US. The main culprits are Michigan’s limitless PIP system and the lack of regulations on how much medical institutions can charge for a PIP-related claim. In fact, Michigan’s car insurance is so expensive that recent studies show it’s unaffordable for many of the state’s residents.
4. Is Geico available in Michigan?
Yes, the company sells auto insurance in Michigan. Unfortunately, we couldn’t complete an online quote, meaning you’ll have to contact an agent to get one.
5. Is car insurance expensive in Michigan?
Yes, the auto insurance Michigan drivers have available is among the most expensive in the US according to many different rankings, including ours. This is mainly due to the state’s unique no-fault system and the lack of adequate legislative measures in the insurance sector.